STRATEGIC ANALYSIS

Strategic Analysis

Strategic Analysis

The company

The company that I have chosen to conduct strategic analysis is Tesco. Tesco (LSE: TSCO ) is a multinational chain of outlets for retail with its headquarters in the UK . In 2008, Tesco became the fourth largest retailer in the world, displacing the fifth largest distributor Metro AG , the first movement of positions among the top five companies in the sector since 2003 . Originally specializing in food and drinks, has diversified into areas such as clothing, electronics, financial services, selling and renting DVDs , compact discs, digital downloads , Internet service , telecommunications , medical and dental insurance and software (Conner, 1993).

Today it is the third largest global retailer based on revenue, behind Wal-Mart and French Carrefour, but the second largest based on profit, ahead of Carrefour. In 1919, Tesco Plc was established by Jack Cohen, by utilizing the bonus which he achieved for his services in the World War I army. Then in 1924, he purchased a tea consignment from the company TE Stock well. He decided to put the initial three alphabets of TE Stock well, and the initials of his name Cohen collectively to name his brand 'TESCO'. In 1929 Cohen opened the very first Tesco store in Edgware, London. Originally, Cohen's formulated the strategy of "Piling it high, selling it cheap"(Tipples, 2002).

Despite the fact that this strategy assisted Tesco in attracting a great amount of consumers, it also assisted Tesco in branding itself as a store for average class consumers and even earned an image as a low-end store. Furthermore, Tesco had small and poorly equipped stores, as well. The only competitive edge Tesco had been the price. The products that were available at the store seemed to be of ordinary. Due to the rise in the income of customers in Britain, the customers did not want to look for bargains. They were now seeking high quality products. In order to cater these changing demands of the customer, Tesco decided to close down its numerous stores to focus on superstores to provide improved quality.

Product & service

Products

Services

Brands

Food

General merchandise

Electrical goods

Clothing

Household goods

Home furnishings

Petrol

Online sale of products

Telecommunication services

Financial services

Pharmacy services

Broadband internet services

Cherokee

F&F

Healthy Living

Value

Tesco standard

Finest Tesco

Industry Analysis: Pestel Framework

Political Factors

Tesco is functioning well and providing services with its stores all around the world. For the legislations of employment, the government promotes retailers to supply a blend of job openings from low paying stretchy and locally-based jobs to centrally-located, skilled and high paying jobs in order to meet the needs of the students, working parents and senior citizens. Being an innately local and labor concentrated sector, Tesco realizes that selling has a huge impact on people and the jobs factors. It often hires students, aged and disabled people at lower wages, and in an industry with characteristically soaring staff revenue, these employees proffer a higher level of allegiance and consequently symbolize sought-after workforce (McTaggart, 2006).

Economic Factors

Fiscal aspects are of apprehension to Tesco, as they are probable to pressure costs, prices, profits and ...